hese issues associated with using accounting measures as performance measures through use of nonaccounting measures in conjunction with accounting-based measures to help mitigate the problems of using accounting-based measures alone. Most performance measurement systems today use a combination of accounting-based measures and non-accounting-based measures, short-term or long-te
Historically, performance measurement systems have been based on accounting or other quantitative numbers. One issue is that some accounting numbers can be affected by the actions of managers, and this may result in distorted performance results. A well-designed performance measurement system should eliminate these potential conflicts, as much as possible.
There is a way to prevent these issues associated with using accounting measures as performance measures through use of nonaccounting measures in conjunction with accounting-based measures to help mitigate the problems of using accounting-based measures alone.
Most performance measurement systems today use a combination of accounting-based measures and non-accounting-based measures, short-term or long-term indicators, or quantitative and qualitative components.
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